Value Chains: Real or Virtual?

3. Value chains: Real or Virtual? With the steady grown in the country's economy as well as the people's living standards, the rhythm of people's living is speeding up and a lot of changes have taken place in their daily life. The discussion about whether or not the Value chains is real or virtual is a very controversial one. Many people take the view that the reality of the value chain has a strong applied legacy. Nevertheless, there are also a majority of people insist that the value chain is a assumption as the business development. As far as I am considered that performing both the real value chain activities and the virtual value chain activities is important; however, in e-commerce, more and more activities become information based and performing them electronically becomes far more important than conducting these functions physically.

The concept of the value chain was primarily targeted toward manufacturing firms, in which the value of activities is mostly concerned with the physical flow of material, for example, acquiring raw material, manufacturing products, distributing products, marketing products, and installing or repairing the products for customer use. In the present digital age, a majority of firms are planning to conduct their business electronically, in which ‘‘information’’ becomes the main medium through which business transactions are exchanged. The extent to which e-commerce will affect the marketing of products and services will depend on the amount and the value of information that flows through the value chain. Over the years, some businesses have controlled almost all factors of production and distribution, for example Ford in early years, whereas others have outsourced almost everything, such as Dell. In the early days of industry, large enterprises controlled and owned most factors of production and businesses like Ford Motor Company in the USA had their own foundries, railroad, and electricity generating plants, In the...

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GB570: Managing The ValueChain
Dr. Craddock
Kaplan University
January 6, 2012
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